State Council Gives Green Light for Debt-to-Equity Swap Trials

(Beijing) – The government has signaled that it is pushing forward with a program to allow debt-to-equity swaps as part of a strategy to deal with trillions of yuan of corporate loans at risk of turning sour.

The State Council, China's cabinet, released a policy, published in full by the official Xinhua News Agency on July 18, which says financial institutions will be allowed to hold equity in enterprises on a trial basis.